Senator Cynthia Lummis has issued a stark warning to the Federal Deposit Insurance Corporation (FDIC) regarding the alleged destruction of key documents related to Operation Choke Point 2.0 (OCP 2.0), a multi-agency initiative that allegedly targeted crypto businesses by limiting their access to banking services.
In a letter sent on January 16, 2025, to FDIC Chair Marty Gruenberg, Lummis demanded the preservation of all documents tied to the controversial operation. Whistleblowers have claimed that the FDIC attempted to suppress critical information and destroy materials that could expose the crackdown on the crypto industry.
Lummis, a vocal supporter of the cryptocurrency sector, emphasized that any destruction of these documents or retaliation against whistleblowers would be met with criminal referrals to the Department of Justice. She called the actions illegal and unacceptable, stressing that obstructing Senate oversight is a violation of the law.
In the letter, Lummis stated:”This is illegal and unacceptable. You are directed to ensure your staff cease and desist destruction of all materials and end all retaliatory actions immediately.”
The allegations of document destruction are further exacerbated by whistleblower claims that FDIC management has been actively monitoring staff to prevent the disclosure of sensitive materials related to OCP 2.0.
Concerns Over Bank Closures and Political Ramifications
The controversy surrounding the FDIC’s actions comes amid ongoing scrutiny of the agency’s role in the closures of crypto-friendly banks like Signature Bank and Silvergate Bank. These closures have sparked investigations into whether government agencies are deliberately targeting institutions associated with the crypto industry.
In a related development, Lummis has also raised concerns about the proposed sale of seized Bitcoin by U.S. Marshals. She criticized the timing of the sale, which appears to conflict with President-elect Donald Trump’s vision of creating a national Bitcoin reserve using seized crypto assets.
Potential Overhaul of FDIC and Banking Regulations
The situation surrounding the FDIC’s document destruction coincides with discussions within President-elect Trump’s advisory team about potentially overhauling the banking sector. Among the proposed changes is the idea of merging the FDIC, Office of the Comptroller of the Currency (OCC), and Federal Reserve’s nonmonetary functions to streamline regulation. There is also talk of transferring deposit insurance responsibilities to the Treasury Department.
Scott Bessent Opposes U.S. CBDC Amid Crypto Pushback
Amid these developments, Scott Bessent, Trump’s Treasury nominee, has voiced his opposition to the creation of a U.S. central bank digital currency (CBDC). In a Senate hearing, Bessent argued that the U.S. dollar already provides secure investment alternatives, making a CBDC unnecessary. His stance reflects the Trump administration’s broader support for decentralized financial systems and skepticism towards foreign CBDCs.
Bessent’s position aligns with Trump’s pro-crypto policies, which emphasize Bitcoin and other decentralized assets as the future of finance. However, Bessent has faced questioning from Senator Elizabeth Warren regarding his views on crypto regulation, particularly concerning the potential authority of the Office of Foreign Assets Control (OFAC) over stablecoins to combat illicit activities like money laundering.
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